THE WAREHOUSE RECEIPT SYSTEM ACT, 2006.
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ARRANGEMENT OF SECTIONS
Section PART I—PRELIMINARY
1. Short title
2. Interpretation
PART II—ESTABLISHMENT AND FUNCTIONS
OF THE AUTHORITY
3. Establishment of the Authority
4. Functions of the Authority
5. Powers of the Authority
6. Performance of functions of the Authority
PART III—THE BOARD
7. Board of Directors
8. Tenure of office of members of the Board
9. Remuneration of members of the Board
10. Functions of the Board
11. Meetings of the Board
PART IV–STAFF OF THE AUTHORITY
12. Managing Director
13. Secretary
14. Other staff
15. Experts and consultants
PART V—FINANCIAL PROVISIONS
16. Funds of the Authority
17. Duty of the Authority to operate on sound financial principles
18. Bank accounts
19. Borrowing powers
20. Investment of surplus funds
21. Estimates
Section
22. Accounts
23. Audit
24. Financial year
PART VI–LICENSING
25. Licence to warehouse keepers generally
26. Procedure for granting of licences
27. Term and renewal of licence
28. Applicant to execute bond
29. Action on bond by person injured
30. Designation as a licenced and bonded warehouse
31. Causalty insurance and recovery for loss.
32. Cancellation of insurance and suspension of licence
33. Deposit of goods deemed to be made subject to the Act
34. Suspension and revocation of warehouse keeper’s licence
35. Licence to inspect, weigh, grade, classify and certify stored goods
36. Suspension of licence to inspect, weigh, grade, classify and certify stored goods
37. Inspection and grading of stored goods.
38. Publication of licencees, investigations and revoked licences
PART VII—ISSUE OFWAREHOUSE RECEIPTS
39. Who may issue a warehouse receipt
40. Form of warehouse receipt
41. Lost or missing receipt
42. Establishment of Central Registry
PART VIII–OBLIGATIONS OF WAREHOUSE KEEPERS
43. Obligation of warehouse keeper to deliver
44. Liability for non receipt or misdescription
45. Duty of care and contractual limitation
46. Irregularities in the issue of receipts or conduct of the warehouse keeper
47. Duplicate receipt and over-issue
48. Separation of goods and fungible goods
49. Termination of storage at warehouse keeper’s option
50 Warehouse keeper’s lien
51. Enforcement and loss of warehouse keeper’s lien
Section
PART IX—NEGOTIATION AND TRANSFER OF WAREHOUSE RECEIPTS
52. Form of negotiation and requirements for due negotiation
53. Rights acquired by due negotiation
54. Rights defeated in certain cases
55. Rights acquired in the absence of due negotiation
56. Rights and obligations of transferors and transferees
57. Conflicting claims and interpleader
PART X—OFFENCES
58. Issue of receipt for goods not received
59. Issue of receipt containing false statement
60. Issue of duplicate receipts not duly marked
61. Issue of receipts not stating fact of warehouse keeper’s ownership of goods
62. Delivery of goods without obtaining negotiable warehouse receipt
63. Negotiation of receipt for mortgaged goods
64. Issue of warehouse receipt without a valid licence.
PART XI—MISCELLANEOUS
65. Revocation or termination of licence not to affect receipts
66. Insurance of goods
67. Inspection of warehouses by Authority
68. Classification of warehouses
69. Fees
70. Seal of the Authority
71. Protection of members of the Board and staff of the Authority
72. Annual report
73. Minister to report to Parliament
74. Regulations
75. Minister’s power to amend Schedules
SCHEDULES
FIRST SCHEDULE—CURRENCY POINT
SECOND SCHEDULE—MEETINGS OF THE BOARD
THIRD SCHEDULE—FORM OF WAREHOUSE RECEIPT
THE WAREHOUSE RECEIPT SYSTEM ACT, 2006.
An Act to provide for the licensing of warehouses and warehouse keepers, to
provide for a national system of warehouse bonding for the protection of
depositors, to provide for the issue of warehouse receipts and to provide for
other related matters.
DATE OF ASSENT: 24th May, 2006.
Date of commencement: 8th June, 2006.
BE IT ENACTED by Parliament as follows:
PART I—PRELIMINARY
1. Short title
This Act may be cited as the Warehouse Receipt System Act, 2006.
2. Interpretation
(1) In this Act, unless the context otherwise requires—
“Authority” means the Uganda Warehouse Receipt System Authority
established by section 3;
“bailor” means the owner of the goods who directly or through his or her
nominee delivers goods to a warehouse keeper for the purpose of storage
in the name of the bailor or nominee of the bailor;
“bond” has the meaning given to it in section 28 of this Act;
“broker” means a person who sells on behalf of the depositor on the Uganda
Agricultural Commodity Exchange;
“buyer in the ordinary course of business” means a person who, in good faith
and without knowledge that the sale to him or her is in violation of the
ownership rights or security interest of a third party in the goods, buys in
ordinary course from a person in the business of selling goods of that
kind;
“buying” may be for cash or by exchange of other property or on secured or
other secured credit but does not include as security for or in total or
partial satisfaction of a money debt;
“Central Registry” means the Central Registry established by section 42;
“conspicuous” in relation to a term, clause or sign, means it is so written and
located such that a reasonable person against whom it is to operate ought
to have noticed it;
“court” means any court of judicature not lower than the Chief Magistrate’s
court;
“currency point” has the value specified in relation to a currency point in the
First Schedule to this Act;
“delivery” with respect to goods or documents, means voluntary transfer of
possession of the goods or documents;
“depositor” means a person who places the goods in a warehouse and is issued
a receipt by the Authority to that effect;
“field warehouse” means a building or other protected enclosure which has
been leased or licenced by a person for the purpose of operating a
warehouse and issuing warehouse receipts in respect of goods owned by
the owner of the premises or third persons;
“fungible” means goods which are identical with others of the same nature
which by usage or trade, can replace another unit and goods that are not
fungible shall be deemed fungible for the purposes of this Act to the
extent that under a particular agreement or document, unlike units are
treated as equivalents;
“good faith” means honesty in fact in the conduct or transaction involved;
“goods” means all things which are treated as movable for the purposes of a
contract of storage or bailment, including, in the case of goods to be
packed, processed, substituted or otherwise transformed in the
warehouse, their products, and includes documents, securities and
instruments;
“holder” means a person who is in possession of a warehouse receipt issued or
endorsed to that person or to his or her order or to bearer or in blank;
“Managing Director” means the Managing Director of the Authority appointed
under section 12, or a person authorised to act on his or her behalf;
“Minister” means the Minister responsible for trade;
“negotiable receipt” means a warehouse receipt in which it is stated that the
goods received will be delivered to the bearer or to the order of a named
person;
“non-negotiable receipt” means a warehouse receipt issued to the bearer or to
the order of a specified person and marked non-negotiable on the face of
it;
“notice” in relation to any fact means where a person—
(a) has actual notice of the fact;
(b) has received notice of the fact; or
(c) has received all the facts and circumstances known to that person at
the time in question.
“purchase” includes taking by sale, discount, negotiation, mortgage, pledge,
lien, gift or other voluntary transaction creating an interest in property;
“security interest” means an interest in goods, which secures payment or
performance of an obligation by means of a charge, mortgage, lien,
hypothecation, pledge, or other voluntary encumbrance, or retention or
reservation of title to goods;
“warehouse” means a building or other protected enclosure in which goods are
stored; owned, leased, licenced or otherwise in the legal possession and
exclusive control of the warehouse keeper and includes field warehouse
and a plant or other facility where the goods are packed, processed or
otherwise transformed;
“warehouse keeper” means a person licenced under this Act to engage in the
business of storing goods for hire, no matter whether such goods undergo
packaging, processing, substitution or other transformation while in the
warehouse; and includes a person who operates a field warehouse;
“warehouse receipt,” means a receipt for goods issued by a warehouse keeper
duly licenced and bonded under this Act and includes a negotiable and
non-negotiable warehouse receipt.
(2) In this Act, a person is taken to know or to have knowledge of a fact if that
person has actual knowledge of that fact.
(3) For the purposes of the definition of ‘negotiable receipt’ under subsection
(1) no provision shall be inserted in the negotiable receipt that the receipt is not
negotiable; and any such provision if inserted, is void.
(4) In this Act, a person shall be taken to give “value” for any right if he or she
acquires it—
(a) in return for a binding commitment to extend credit or for the extension of
immediately available credit whether or not drawn; or
(b) as security for or in total or partial satisfaction of a pre-existing claim; or
(c) by accepting delivery under a pre-existing contract for purchase; or
(d) generally, in return for any consideration sufficient to support a simple
contract.
PART II—ESTABLISHMENT AND FUNCTIONS OF THE AUTHORITY.
3. Establishment of the Authority
(1) There is established an Authority to be known as the Uganda Warehouse
Receipt System Authority.
(2) The Authority shall be a body corporate, with perpetual succession and a
common seal and may sue or be sued in its corporate name; and subject to this Act,
may borrow money, acquire and dispose of property and do all such things as a body
corporate may lawfully do.
4. Functions of the Authority
The functions of the Authority are—
(a) to license warehouses;
(b) to license warehouse keepers;
(c) to license warehouse inspectors;
(d) to issue negotiable warehouse receipts books; and
(e) to carry out and perform such other functions as are conferred or imposed
on it by this Act or regulations made under this Act.
5. Powers of the Authority
For the carrying out of its functions under section 4 of this Act, the Authority shall
have power—
(a) to investigate the storage, warehousing, classifying according to grade and
otherwise, weighing, and certification of goods in Uganda;
(b) upon application by any person applying for a licence to operate a
warehouse under this Act, to inspect the warehouse or cause it to be
inspected;
(c) at any time, with or without application, to inspect or cause to be inspected
all warehouses licenced under this Act;
(d) to determine whether warehouses for which licences are applied for or have
been issued under this Act are suitable for the proper storage of any
goods;
(e) to classify warehouses licenced or applying for a licence in accordance with
their ownership, location, surroundings, capacity, conditions, and other
qualities, and according to the kinds of licences issued or to be issued for
them under this Act;
(f) upon application, to issue to any warehouse keeper a licence for the conduct
of a warehouse in accordance with this Act and regulations made under
this Act;
(g) to prescribe, within the limitations of this Act, the duties of the warehouse
keepers conducting warehouses licenced under this Act with respect to
their care of and responsibility for the goods stored;
(h) to provide guidelines and standards for the suitability for the proper storage
of the goods;
(i) to suspend or revoke a licence issued to a warehouse keeper, for any
contravention of or failure to comply with any provision of this Act or
regulations made under this Act;
(j) to charge, assess and collect fees for every examination or inspection of a
warehouse and for the issue of licences;
(k) to examine all books, records, papers, and accounts of warehouses and of
warehouse keepers;
(l) to borrow for the purposes of carrying out its functions under this Act;
(m) to issue negotiable warehouse receipt books;
(n) to close the premises of a warehouse keeper who operates without a valid
licence; and
(o) to carry out any other activity incidental or conducive to the carrying out of
its functions under section 4.
6. Performance of functions of the Authority
Notwithstanding anything in this Act, for such period from the commencement of
this Act as shall be prescribed by statutory instrument, the functions of the Authority
under this Act shall be carried out by the Uganda Commodity Exchange or any other
legal entity that the Minister may, by statutory instrument, prescribe.
PART III—THE BOARD
7. Board of Directors
(1) The governing body of the Authority shall be the Board of Directors.
(2) The Board shall consist of—
(a) The Managing Director;
(b) one person representing the Ministry responsible for trade;
(c) a representative of the co-operatives nominated by the apex body of cooperatives;
(d) a representative of the Uganda Clearing and Forwarding Agents
Association, nominated by the Association;
(e) a representative of the Uganda Bankers Association, nominated by the
Association;
(f) a representative of the Uganda Insurers Association, nominated by the
Association;
(g) one person representing the Uganda National Chamber of Commerce and
Industry, nominated by the Chamber;
(h) a representative of the private sector, nominated by the Private Sector
Foundation; and
(i) a representative of the farmers, nominated by the farmers’ apex body.
(3) The members of the Board in subsection (2) paragraphs (b) to (i) shall be
appointed by the minister and shall be persons of high moral character and proven
integrity.
(4) The members appointed under subsection (2) shall be persons who qualify
for appointment by virtue of their experience in commerce, finance, and public
administration, the profession represented or in matters relating to economic
planning and development.
(5) The Board shall have a chairperson who shall be appointed by the Minister
from among the members of the Board.
8. Tenure of office of members of the Board
(1) A member of the Board shall hold office for a term of three years and is
eligible for re-appointment but he or she shall not hold office for more than two
consecutive terms.
(2) A member of the Board may vacate office—
(a) by resignation by letter addressed to the Minister;
(b) on the written recommendation of the body which he or she represents
revoking the nomination of the member;
(3) The Minister may, at any time remove a member of the Board from office
for—
(i) misconduct, misbehaviour or abuse of office;
(ii) failure to attend three consecutive meetings of the Board without
reasonable excuse, certified by the Board;
(iii) inability to perform the functions of office of member arising from
infirmity of body or mind;
(iv) bankruptcy or insolvency; or
(v) conviction for an offence involving fraud or dishonesty.
(4) The Chairperson shall hold office for one year but is eligible for
reappointment for another three years.
(5) The Managing Director shall cease to be a member of the Board upon
ceasing to hold the office of Managing Director.
(6) Where a vacancy occurs in the office of member of the Board, the Minister
shall consult the body which nominated the member ceasing to hold office for the
purpose of appointing another person in place of the member ceasing to hold office.
9. Remuneration of members of the Board
Members of the Board shall be paid such sitting and other allowances as the Board
may, with the approval of the Minister, determine.
10. Functions of the Board
Subject to the provisions of this Act, the Board shall, in the name of the Authority—
(a) carry out and exercise the functions and powers of the Authority under this
Act;
(b) manage the property, funds and income of the Authority and other
concerns and affairs of the Authority;
(c) discharge the business of the Authority under this Act;
(d) appoint and remove the staff of the Authority; and
(e) perform such other functions as may be conferred or imposed on the Board
by this Act or by regulations made under this Act.
11. Meetings of the Board
The Second Schedule to this Act shall apply in relation to meetings of the Board and
other matters specified in that Schedule.
PART IV—STAFF OF THE AUTHORITY
12. Managing Director
(1) There shall be a Managing Director of the Authority who shall be appointed
by the Board on terms and conditions that the Board may determine.
(2) The Managing Director shall be the Chief Executive of the Authority and
shall be responsible for the day to day operations of the Authority.
(3) Subject to the provisions of this Act and the general supervision and control
of the Board, the Managing Director shall be responsible for the management of the
funds, property and business of the Authority and for the administration,
organisation and control of the staff of the Authority.
(4) The Managing Director shall be a member of the Board.
(5) The Managing Director shall, from time to time, in writing, keep the Board
informed of the progress of the business of the Authority.
(6) Where the Managing Director is, for any reason, incapacitated from the
performance of the functions of that office, the Board shall designate an officer of
the Authority to perform those functions until the end of the incapacity of the
Managing Director.
13. Secretary
(1) The Authority shall have a Secretary who shall be appointed by the Board
on such terms and conditions as the Board may determine.
(2) The Secretary shall—
(a) take minutes of the meetings of the Board;
(b) keep a record of all the activities of the Authority; and
(c) act as registrar of the Central Registry.
(3) In the performance of his or her functions under this Act, the Secretary
shall, except where the Board otherwise directs in writing be responsible to the
Managing Director.
14. Other Staff
(1) The Authority shall have such other officers as the Board may determine to
be necessary for the efficient operation of the Authority.
(2) The Board may, on terms and conditions it deems fit, fix remuneration,
grant pension, gratuities or other benefits on retirement or termination of services of
the officers and employees of the Authority and may require them to contribute to
any pension, provident fund or superannuation scheme.
(3) The Board may delegate any of its powers of appointment under this section
to the Managing Director, subject to such conditions as the Board may determine.
15. Experts and consultants
(1) The Board may, on the advice of the Managing Director, engage the
services of experts and consultants in respect of any functions of the Authority with
which they are considered to have special competence.
(2) Experts or consultants engaged under this section may be paid such fees and
allowances, and may be afforded such facilities as the Board may determine.
PART V—FINANCIAL PROVISIONS.
16. Funds of the Authority
The funds of the Authority shall consist of—
(a) money from time to time appropriated by Parliament;
(b) all moneys received by the Authority from issuing licences under this Act;
(c) all moneys received by the Authority from inspecting and supervising
warehouses;
(d) all moneys borrowed by the Authority;
(e) all moneys derived from the sale of warehouse receipt books;
(f) any other moneys received by or made available to the Authority for the
purpose of performing its functions under this Act.
17. Duty of the Authority to operate on sound financial principles
The Authority shall perform its functions in accordance with sound and
internationally accepted financial principles.
18. Bank accounts
(1) The Authority shall open and maintain such bank accounts as are necessary
for the performance of its functions.
(2) The Authority shall ensure that all money received by or on behalf of the
Authority is banked as soon as practicable after being received.
(3) The Authority shall ensure that no money is withdrawn from or paid out of
any of the bank accounts of the Authority without the authority of the Board.
19. Borrowing powers
The Authority may, with the approval of the Minister given in consultation with the
Minister responsible for finance, borrow money from any source as may be required
for meeting its obligation or for the discharge of the functions of the Authority under
this Act.
20. Investment of surplus funds
Any funds of the Authority not immediately required for a purpose under this Act
may be invested in a manner, which the Board may, after consultation with the
Minister and the Minister responsible for finance determine.
21. Estimates
(1) The Managing Director shall, within three months before the end of each
financial year, prepare and submit to the Board for its approval, estimates of income
and expenditure of the Authority for the next following financial year and may, at
any time before the end of each financial year, prepare and submit to the Board for
approval any estimates supplementary to the estimates of the current year.
(2) No expenditure shall be made out of the funds of the Authority unless that
expenditure is part of the expenditure approved by the Board under the estimates for
the financial year in which that expenditure is to be made or in estimates
supplementary to that year’s estimates.
22. Accounts
(1) The Board shall ensure that the Authority keeps proper accounts and
records of its transactions and affairs and shall ensure that all moneys received are
properly accounted for, all payments of its moneys are correctly made and properly
authorised and that adequate control is maintained over its property and over the
incurring of liabilities by the Authority.
(2) The accounts of the Authority shall be kept in such form as the Auditor
General shall direct.
(3) The Board shall cause to be prepared in respect of each financial year, and
not later than three months after the close of the financial year, a statement of
accounts which shall include a report on the performance of the Authority during
that financial year; and the statement shall comprise—
(a) a balance sheet, a profit and loss account and application of funds statement;
and
(b) any other information in respect of the financial affairs of the Authority as
the Minister may, in writing, require.
23. Audit
(1) The accounts of the Authority shall, in respect of each financial year, be
audited by the Auditor-General or by an auditor appointed by the Auditor-General.
(2) The Board shall ensure that within four months after the close of each
financial year, the statement of accounts described in section 19 of this Act is
submitted for auditing under this section.
(3) The Auditor General and any auditor appointed by the Auditor General
shall have access to all books of accounts, vouchers and other financial records of
the Authority and is entitled to any information and explanations required.
(4) The Auditor-General shall, within two months after receipt of the statement
of accounts under subsection (2) of this section, audit the accounts and deliver to the
Board a copy of the audited accounts together with his or her report on them stating
any matter which in his or her opinion should be brought to the attention of the
Minister.
(5) The Board, shall as soon as possible upon receiving it, deliver to the
Minister a copy of the audited accounts together with the auditor’s report under
subsection (4) of this section.
24. Financial year
The financial year of the Authority shall be the period of twelve months beginning
on the 1st day of July and ending on the 30th day of June in the next calendar year;
except that the first financial year of Authority shall be the period commencing with
the commencement of this Act and ending with the 30th day of June next following.
PART VI—LICENSING
25. Licence to warehouse keepers generally
(1) No person shall operate a warehouse without a valid license issued by the
Authority under this Act.
(2) The Authority may, upon application in the prescribed form, issue to a
warehouse keeper a licence for the conduct of a warehouse in accordance with this
Act.
(3) In issuing a licence under subsection (2) the Authority shall satisfy itself
that—
(a) the warehouse is suitable for the proper storage of the particular goods for
which a licence is applied;
(b) the warehouse keeper meets the conditions for eligibility to operate a
licenced warehouse prescribed by regulations made under this Act; and
(c) the warehouse keeper agrees, as a condition to the granting of the license, to
comply with and abide by all the terms of this Act and regulations made
under this Act.
26. Procedure for granting of licences
(1) Any person who wishes to acquire a licence may apply to the Authority in
the manner prescribed by regulations made under this Act.
(2) The Authority shall, before granting a warehouse licence under this Act,
authorise the inspection of the warehouse in respect of which a licence is applied
for, to determine whether the warehouse is suitable for the storage of the particular
goods for which the licence is required.
(3) The Authority shall, upon being satisfied that the warehouse is suitable for
the storage of the goods in question, grant a warehouse licence to the applicant.
(4) The applicant shall, upon being granted a licence under this Act, pay a fee
prescribed by the Authority and the holder of the licence shall thereafter pay a
prescribed fee on or before each anniversary of the granting of the licence.
(5) Every warehouse keeper shall display his or her licence in a conspicuous
place in his or her premises during working hours.
27. Term and renewal of licence
A licence issued under section 25, shall expire on the date provided for in the
licence, or in accordance with the provisions of this Act, and regulations made under
this Act and may, from time to time, be modified or extended by written notice
issued by the Board.
28. Applicant to execute bond
(1) A warehouse keeper applying for a licence to operate a warehouse in
accordance with this Act shall, as a condition to the granting of the licence, execute
and file with the Authority a good and sufficient bond to secure the faithful
performance of his or her obligations as a warehouse keeper under this Act.
(2) Where the Authority determines that a previously approved bond is, or for
any cause has become, insufficient, it may require an additional bond or bonds to be
given by the warehouse keeper concerned, conforming with the requirements of this
section, and, unless the additional bond is given within the time fixed by a written
demand for it by the Authority, the licence of the warehouse keeper may be
suspended or revoked by the Authority.
29. Action on bond by person injured
Any person injured by the breach of any obligation to secure for which a bond is
given, under section 28 of this Act, is entitled to sue on the bond in his or her own
name in court, to recover the damages he or she has sustained by the breach,
provided that no such action shall be commenced unless the dispute has first been
referred to arbitration in accordance with the Arbitration and Conciliation Act.
30. Designation as a licenced and bonded warehouse
(1) Upon the filing with and approval by the Authority, of a bond, in
compliance with this Act, for the conduct of a licenced warehouse, the warehouse
may be designated as licenced and bonded and the warehouse keeper shall display in
a conspicuous place, the Authority emblem.
(2) Notwithstanding anything in this Act, no warehouse shall be designated as
licenced and bonded under this Act and no name or description conveying the
impression that it is so licenced and bonded, shall be used—
(a) until a licence has been issued and a bond, as provided for in section 28 of
this Act, has been filed with and approved by the Authority; or
(b) unless the licence issued under this Act for the conduct of that warehouse
remains unsuspended and unrevoked.
(3) Any person who contravenes subsection (2) commits an offence and is
liable, on conviction, to a fine not exceeding twenty four currency points or
imprisonment for a term not exceeding five years.
31. Casualty insurance and recovery for loss
(1) An applicant for a licence to operate a warehouse under this Act shall, as a
condition to the granting of the licence, file with the Authority a certificate of
insurance evidencing an effective policy of insurance issued by an insurance
company authorised to do business in Uganda insuring in the name of the applicant,
all goods which are or may be in the warehouse for their full market value against
loss by fire, internal explosion, lightening, windstorm and any other disaster, which
the Authority may direct to be included under this category.
(2) Where a fire, internal explosion, lightening, windstorm or any other disaster
under subsection (1) destroys or damages any goods in licenced warehouse, the
warehouse keeper shall, upon demand by the depositor, and upon being presented
with the receipt or other evidence of ownership and after deducting the warehouse
keepers charges and advances, at the market value of the goods based on the value at
the average price paid for the goods of the same grade and quality on the date of the
loss at the location of the warehouse, make settlement.
(3) The warehouse keeper shall make complete settlement to all depositors
having goods stored in his or her warehouse, damaged or destroyed, within ten days
after settlement with the insurance company.
(4) Failure of the warehouse keeper to make such settlement shall be ground for
the revocation or suspension of the warehouse licence.
(5) Where the Authority determines that the previously approved insurance is
insufficient, it shall require additional insurance to be given by the warehouse
keeper conforming to the requirements of this Act.
32. Cancellation of insurance and suspension of licence
(1) A licenced warehouse keeper shall not cancel insurance, approved under
section 31, without the prior written approval of the Authority and its approval of
substitute insurance.
(2) Subject to section 33 of the Insurance Act, an insurance company may
cancel insurance required by this Act only after the expiration of a thirty day period
from the mailing, by registered or certified mail, of notice of intent to cancel, to the
Authority.
(3) The insurance company shall, at the time of giving notice to the Authority
under subsection (2) send a copy of the notice to the warehouse keeper concerned.
(4) Notwithstanding any other provision of this Act, failure of the warehouse
keeper to provide new evidence of insurance within fifteen days after the Authority
receives notice of cancellation shall cause the warehouse license to be suspended.
(5) If new evidence has not been filed by the warehouse keeper by the thirtieth
day following receipt of notice, the warehouse licence shall be revoked.
33. Deposit of goods deemed to be made subject to the Act
A person who deposits goods for storage in a warehouse shall be taken to have
deposited the goods subject to the terms of this Act.
34. Suspension and revocation of warehouse keeper’s licence
The Authority may, after an opportunity to be heard has been afforded to the
licensee concerned, suspend or revoke any licence issued to any warehouse keeper
conducting a licenced warehouse under this Act for any contravention of this Act.
35. Licence to inspect, weigh, grade, classify and certify stored goods.
The Authority may, upon presentation of satisfactory proof of competence, issue to
any person a licence to inspect and sample any goods stored or to be stored in a
warehouse licenced under this Act, and to certify the condition, grade, or other class
of those goods or to weigh the goods and certify their weight on condition that the
person agrees to comply with and abide by the terms of this Act.
36. Suspension of licence to inspect, weigh, grade, classify and certify stored
goods
The Authority may suspend or revoke any licence issued to any person under section
35 if the Authority is satisfied, and an opportunity is afforded to the licencee
concerned to be heard—
(a) that the licensee has failed to inspect, sample, or weigh any goods properly;
(b) that the licensee has contravened any of the provisions of this Act or of any
regulations made under this Act;
(c) that the licensee has used his or her licence or allowed it to be used for an
improper purpose.
37. Inspection and grading of stored goods
Any fungible goods stored in a warehouse licenced under this Act shall be inspected
and graded by a person duly licenced to grade them under this Act prior to
commingling of those goods deposited by other depositors.
38. Publication of licensees, investigations and revoked licences
The Authority shall, from time to time, publish—
(a) the names and addresses of persons licenced under this Act;
(b) the results of any investigations made under section 5 (a) of this Act;
(c) a list of all licences revoked under this Act and the causes for the
revocation.
PART VII—ISSUE OFWAREHOUSE RECEIPTS
39. Who may issue a warehouse receipt
For the purposes of this Act, a warehouse receipt may only be issued by a warehouse
keeper duly authorised and licenced to do so under section 25 of this Act.
40. Form of warehouse receipt
(1) A negotiable warehouse receipt may only be printed by a person designated
by the Authority and shall be in the form prescribed in the Third Schedule to this
Act and supplied exclusively by the Authority.
(2) A warehouse receipt shall bear such security features as shall be a
prescribed by the Authority by regulations.
(3) A non-negotiable warehouse receipt need not be in any particular form but
each such receipt shall embody within its written or printed terms, the following—
(a) the name of the warehouse keeper;
(b) the location of the warehouse where the goods are stored;
(c) the date of issue of the receipt;
(d) the consecutive number of the receipt;
(e) a statement whether the goods received will be delivered to the bearer, to a
specified person or to order;
(f) the rate of storage charges;
(g) a description of the goods and the packages containing the goods;
(h) the signature of the warehouse keeper;
(i) if the receipt is issued for goods of which the warehouse keeper is owner,
either solely or jointly or in common with others, the fact of such
ownership;
(j) a statement of the amount of advances made and of liabilities incurred for
which the warehouse keeper claims a lien, and if the precise amount of
those advances made or of those liabilities incurred is, at the time of the
issue of the receipt, unknown to the warehouse keeper or to his or her
agent, a statement of the fact that advances have been made or liabilities
are incurred and that the purpose of the advances and liabilities is
sufficient; and
(k) if the goods are authorised by the bailor to be packed, processed, substituted
or otherwise transformed while in the warehouse, a statement to that
effect and a description of the type and quantity of goods to be produced
upon the completion of the authorised transformational activities.
(4) For the purposes of subsection (3) (f) the rates of storage charges may be
referred to by reference to the terms of business of the warehouse.
(5) For the purposes of subsection (3) (g) the description of the goods or
packages containing the goods may be qualified as “said to be or to contain” or
goods containing an expiry date in the case of goods held in bags or other sealed
containers.
(6) A warehouse keeper shall be liable to any person who claims to be injured
for all damage caused by the omission of the statement referred to in paragraph (k)
of subsection (3).
(7) A warehouse keeper may insert in a receipt any other terms and conditions
which are not contrary to this Act and which do not impair his or her obligation of
delivery or his or her duty of care and any contrary provision is void.
41. Lost or missing receipt
(1) Where a warehouse receipt is lost, stolen or destroyed, a court may order
delivery of the goods or issue of a substitute receipt and the warehouse keeper may,
without liability to any person, comply with that order, except that—
(a) if the warehouse receipt was negotiable, the claimant must post security
approved by the court to indemnify any person who may suffer loss as a
result of the non-surrender of the document;
(b) if the warehouse receipt was not negotiable, the security may be required at
the discretion of the court;
(c) the court may, order payment of the warehouse keeper’s reasonable costs
and legal fees.
(2) A warehouse keeper who, without a court order, delivers goods to a person
claiming under a missing negotiable warehouse receipt is liable to any person
injured by the delivery, and if the delivery is not made in good faith, is liable for
conversion.
(3) Delivery in good faith is not conversion if the claimant posts security with
the warehouse keeper in an amount at least double the value of the goods at the time
of posting, to indemnify any person injured by the delivery who files a notice of
claim within one year after the delivery.
(4) Where a warehouse receipt is lost, stolen or destroyed, the registrar must be
informed accordingly.
42. Establishment of Central Registry
(1) There is established a Central Registry which shall be operated by the
Authority.
(2) The Secretary to the Authority shall be the Registrar and shall be the
registering officer for the purpose of registering any transaction relating to a
warehouse receipt issued under the Act or any transaction as shall be provided for in
this Act except that the Authority may, with the consent of the Minister, appoint any
person to act as a Deputy Registrar.
(3) A warehouse receipt issued in accordance with this Act including any
negotiation in respect of it shall be delivered up to the Registrar for registration
within fourteen days of any such issue or negotiation.
(4) It shall be sufficient for the purposes of this section if an original copy of
the receipt is delivered by a warehouse keeper to the Registrar for registration.
(5) The Registrar shall receive and register any receipts or negotiations, cancel
any receipts or negotiations and do all such other acts as the Minister may by
regulations prescribe.
(6) There shall be maintained a Register Book that shall contain in
chronological order, all transactions carried on at the Central Registry.
(7) A certificate of registration signed by the Registrar shall be conclusive
evidence of the issue or negotiation of a warehouse receipt.
(8) The Minister shall make such regulations and rules as are necessary to
govern the day to day operations of the Central Registry.
PART VIII—OBLIGATIONS OF WAREHOUSE KEEPER:
WAREHOUSE KEEPER
43. Obligation of warehouse keeper to deliver
(1) A warehouse keeper shall deliver the goods to a person entitled under the
warehouse receipt who complies with subsections (2) and (3) of this section, except
where the warehouse keeper establishes any of the following—
(a) delivery of the goods to a person whose receipt was rightful as against the
claimant;
(b) damage to or delay, loss or destruction of the goods for which the
warehouse keeper is not liable;
(c) previous sale or other disposition of the goods in lawful enforcement of a
lien or on the warehouse keeper’s lawful termination of storage;
(d) release, satisfaction or other fact affording a personal defence against the
claimant; or
(e) any other lawful defence.
(2) A person claiming goods covered by a warehouse receipt must satisfy the
warehouse keeper’s lien if the lien exists and if the warehouse keeper so requests.
(3) A warehouse keeper who, in good faith including observance of reasonable
commercial standards, receives goods and delivers or otherwise disposes of them
according to the terms of the warehouse receipt or in accordance with this Act is not
liable for any such act.
(4) Subsection (3) shall apply even though the person from whom the
warehouse keeper has received the goods had no authority to procure the warehouse
receipt or to dispose of the goods and even though the person to whom he or she
delivered the goods had no authority to receive them.
44. Liability for non receipt or misdescription
A party to, or purchaser for value in good faith of a warehouse receipt relying upon
the description in the receipt of the goods may recover from the warehouse keeper,
damages caused by the non-receipt or misdescription of the goods, except to the
extent that the document conspicuously indicates that—
(a) the warehouse keeper is authorised to pack, process, substitute or otherwise
transform the goods while in storage;
(b) in the case of paragraph (a) the warehouse keeper is liable for the nonreceipt
or misdescription of the goods as transformed in accordance with
the terms of the agreement with the bailor providing for such
transformation;
(c) the warehouse keeper does not know whether any part or all of the goods in
fact were received or conform to the description, as where the description
is in terms of marks or labels or the receipt or description is qualified by
“contents, condition and quality unknown,” “said to be or contain” or
similar terms, if the indication is true, or the party or purchaser otherwise
has notice.
45. Duty of care and contractual limitation
(1) A warehouse keeper is liable for damages for loss of or injury to the goods
caused by the warehouse keeper’s failure to exercise such care in regard to them as a
reasonably careful person would exercise under similar circumstances; but, unless
otherwise agreed, the warehouse keeper is not liable for damages that could not have
been avoided by the exercise of such care.
(2) Notwithstanding the general effect of subsection (1), it is the duty of the
owner of the goods to disclose to the warehouse keeper any peculiarities in the
nature of the goods to be stored.
46. Irregularities in the issue of receipts or conduct of the warehouse keeper
The obligations imposed by this Act on a warehouse keeper apply to a warehouse
receipt regardless of the fact that—
(a) the document may not comply with the requirements of this Act or of any
other law regarding its issue, form or content;
(b) the warehouse keeper may have contravened any law regulating the conduct
of his or her business;
(c) the goods covered by the document were owned by the warehouse keeper at
the time the warehouse receipt was issued; or
(d) the person issuing the document does not fall within the definition of a
warehouse keeper if the document purports to be a warehouse receipt.
47. Duplicate receipt and over-issue
(1) Neither a duplicate warehouse receipt nor any other document of title
purporting to cover goods already covered by an outstanding warehouse receipt
confers any right in the goods, except in the case of over-issue of documents for
fungible goods and substitutes for lost, stolen or destroyed documents.
(2) The warehouse keeper is liable for damages caused by his or her overissue
or failure to identify a duplicate document as such by conspicuous notation on its
face.
48. Separation of goods and fungible goods
(1) Unless the warehouse receipt otherwise provides, a warehouse keeper must
keep separate the goods covered by each receipt so as to permit, at all times,
identification and delivery of those goods or, where packing, processing,
substitution or other transformation is authorised by the bailor, the transformed
products of those goods; except that different lots of fungible goods may be
commingled.
(2) Fungible goods commingled under subsection (1) are owned in common by
the persons entitled to them and the warehouse keeper is severally liable to each
owner for that owner’s share.
(3) Where, because of over-issue a mass of fungible goods is insufficient to
meet all the receipts that the warehouse keeper has issued against it, the persons
entitled include all holders to whom overissued receipts have been issued, duly
negotiated or otherwise transferred.
49. Termination of storage at warehouse keeper’s option
(1) A warehouse keeper may, on notifying the person on whose account the
goods are held and any other person known to claim an interest in the goods, require
payment of any charges and removal of goods from the warehouse—
(a) at the termination of the period of storage fixed by the warehouse receipt or
storage agreement; or
(b) if no period is fixed, within a stated period not less than thirty days after
notification.
(2) If the goods are not removed before the date specified in the notification,
the warehouse keeper may sell them in accordance with section 50 of this Act.
(3) If a warehouse keeper in good faith believes that the goods are about to
deteriorate or decline in value to less than the amount of his or her lien within the
time prescribed in subsection (1) for notification, advertisement and sale, the
warehouse keeper may specify in the notification any reasonable shorter time for
removal of the goods; and if the goods are not removed, may sell them at the
Uganda Agricultural Commodity Exchange (UACE) or at public sale (auction) held
not less than one week after a single advertisement or posting.
(4) If, as a result of a quality or condition of the goods of which the warehouse
keeper had no notice at the time of deposit, the goods are a hazard to other property
or to the warehouse or to persons, the warehouse keeper may sell the goods at the
Uganda Agricultural commodity exchange; or public (auction) or private sale
without advertisement on reasonable notification to all persons known to claim an
interest in the goods.
(5) If the warehouse keeper, after a reasonable effort and after notifying the
Authority, is unable to sell the goods, he or she may dispose of them in any lawful
manner and shall incur no liability by reason of that disposition.
(6) A sale under section 49 is only possible if the warehouse keeper has
informed the Uganda Warehouse Authority within fourteen days for purposes of
registering the sale, cancellation of the receipt and notification of the cancellation.
(7) A warehouse keeper must deliver the goods to any person entitled to them
under this Act upon due demand made at any time before sale or other disposition
under this section.
(8) A warehouse keeper may satisfy his or her lien from the proceeds of any
sale or disposition under this section but must hold the balance for delivery on the
demand of any person to whom he or she would have been bound to deliver the
goods.
50. Warehouse keeper’s lien
(1) A warehouse keeper has a lien against the bailor on the goods covered by a
warehouse receipt or on the proceeds of those goods in his or her possession for
charges for storage, packing, processing or transportation, insurance, labour, or other
charges present or future in relation to the goods, and for expenses necessary for
preservation of the goods or reasonably incurred in their sale according to law.
(2) If the person on whose account the goods are held is liable for similar
charges or expenses in relation to other goods whenever deposited and it is stated in
the receipt that a lien is claimed for charges and expenses in relation to other goods,
the warehouse keeper also has a lien against him or her for those charges and
expenses whether or not the other goods have been delivered by the warehouse
keeper.
(3) Where a negotiable warehouse receipt is duly negotiated to any person, a
warehouse keeper’s lien is limited to charges in an amount or at a rate specified on
the receipt or if no charges are so specified then to a reasonable charge for storage of
the goods covered by the receipt subsequent to the date of the receipt.
(4) A warehouse keeper may also reserve a security interest against the bailor
for a maximum amount specified on the receipt for charges other than those
specified in subsection (1), such as for money advanced and interest, except that the
creation of the security interest shall be governed by the laws relating to that security
interest.
(5) A warehouse keeper’s lien for charges and expenses under subsection (1) or
a security interest under subsection (4) shall be effective against any person who so
entrusted the bailor with possession of the goods that a pledge of them by him or her
to a bona fide purchaser for value would have been valid but is not effective against
a person as to whom the document confers no right in the goods covered by it under
section 50 of this Act.
(6) A warehouse keeper shall lose his or her lien on any goods which he or she
voluntarily delivers or which he or she unjustifiably refuses to deliver.
51. Enforcement and loss of warehouse keeper’s lien
(1) Except as provided in subsection (6), a warehouse keeper’s lien may be
enforced by sale conducted through the Uganda Agricultural Commodities
Exchange, public auction or private sale of the goods in bloc or in parcels, at any
time or place and on any terms which are commercially reasonable, after notifying
all persons known to claim an interest in the goods in accordance with subsection (4)
of this section.
(2) If the warehouse keeper either sells the goods in the usual manner in any
recognised market for the goods, or if he or she sells at the price current in such
market at the time of the sale, or if he or she otherwise sells in conformity with
commercially reasonable practices among dealers in the type of goods sold, he or
she is taken to have sold in a commercially reasonable manner.
(3) The fact that a better price could have been obtained by a sale at a different
time or in a different method from that selected by the warehouse keeper is not itself
sufficient to establish that the sale was not made in a commercially reasonable
manner.
(4) A warehouse keeper’s lien on goods other than goods stored by a depositor
in the course of his or her business may be enforced only as follows—
(a) all persons known to claim an interest in the goods must be notified;
(b) the notice must be delivered in person or sent by registered letter to the last
known address of any person to be notified;
(c) the notice must include an itemised statement of the claim, a description of
the goods subject to the lien, a demand for payment within a specified
time not less than ten days after receipt of the notification and a
conspicuous statement that unless the claim is paid within that time, the
goods will be advertised for sale and sold by auction at a specified time
and place;
(d) the sale must conform to the terms of the notice;
(e) the sale must be held at the nearest suitable place to that where the goods
are held or stored; and
(f) after the expiration of the time given in the notice, an advertisement of the
sale shall be published in the Gazette and once a week for two weeks in a
newspaper of general circulation in Uganda.
(5) Before any sale under this section any person claiming a right in the goods
may pay the amount necessary to satisfy the lien and the reasonable expenses
incurred under this section.
(6) Where subsection (5) is complied with, the goods must not be sold, but
must be retained by the warehouse keeper, subject to the terms of the receipt and this
Act.
(7) A warehouse keeper may buy at any public sale (auction) under this section.
(8) A purchaser in good faith of goods sold to enforce a warehouse keeper’s
lien takes the goods free of any rights of persons against whom the lien was valid,
despite non-compliance by the warehouse keeper with the requirements of this
section.
(9) A warehouse keeper may satisfy his or her lien from the proceeds of any
sale under this section but must hold the balance, if any, for delivery on demand to
any person to whom he or she would have been bound to deliver the goods.
(10) The rights provided under this section shall be in addition to all other
rights allowed by law to a creditor against his or her debtor.
(11) Where there is a lien is on goods stored by a depositor in the course of his
or her business the lien may be enforced in accordance with subsection (5).
(12) A warehouse keeper is liable for damages caused by failure to comply
with the requirements for sale under this section and in case of wilful contravention,
is liable for conversion.
(13) A warehouse keeper shall lose his or her lien on the goods by—
(a) surrendering possession of the goods;
(b) refusing to deliver the goods when a demand is made with which he or she
is bound to comply under this Act.
PART IX—NEGOTIATION AND TRANSFER OFWAREHOUSE RECEIPTS
52. Form of negotiation and requirements for due negotiation
(1) A negotiable warehouse receipt to the order of a named person is negotiated
by his or her endorsement on its delivery and registration of the negotiation by the
Authority.
(2) Negotiation of a negotiable warehouse receipt after it has been endorsed to
a specified person requires endorsement by the endorsee as well as delivery and
registration with the Authority.
(3) A negotiable warehouse receipt is treated as duly negotiated when it is
negotiated in the manner stated under this section to a person who purchases it in
good faith without notice of any defect in it or claim to it on the part of any person,
and for value.
(4) Endorsement of a non-negotiable warehouse receipt does not make it
negotiable and does not add to the transferee’s rights.
53. Rights acquired by due negotiation
(1) Subject to this section, a holder to whom a negotiable warehouse receipt has
been duly negotiated acquires by that act—
(a) title to the warehouse receipt;
(b) title to the goods, including, to the extent that such activities are authorised
by the bailor and noted on the warehouse receipt, the packed, processed,
substituted or otherwise transformed goods of the bailor;
(c) all rights accruing under the law of agency or estoppel, including rights to
goods delivered to the warehouse keeper after the warehouse receipt was
issued; and
(d) the obligation of the warehouse keeper to hold or deliver the goods
according to the terms of the warehouse receipt and any related storage
agreement free of any defence or claim by the warehouse keeper, except
those arising under the terms of the warehouse receipt or storage
agreement or under this Act.
(2) Subject to this section, title and rights acquired under subsection (1) are not
defeated by the surrender of the goods by the warehouse keeper, and are not
prejudiced by any of the following—
(a) that the negotiation or any prior negotiation constituted a breach of duty; or
(b) that any person has been deprived of possession of the warehouse receipt by
misrepresentation, fraud, mistake duress, loss, theft or conversion, or
even though a previous sale or other transfer of the goods or warehouse
receipt has been made to a third person.
(3) Except where a warehouse receipt was originally issued upon delivery of
the goods by a person who had no power to dispose of them, a lien shall not attach
by virtue of any judicial process to goods in the possession of a warehouse keeper
for which a negotiable warehouse receipt is outstanding, unless the document is first
surrendered to the warehouse keeper or its negotiation enjoined by court order, and
the warehouse keeper shall not be compelled to deliver the goods in accordance with
any judicial process until the document is surrendered to him or her or impounded
by the court.
(4) Any person who purchases a warehouse receipt for value without notice of
the process or injunction takes the goods free of the lien imposed by judicial
process.
54. Rights defeated in certain cases
(1) A warehouse receipt creates a charge on the goods deposited at the
warehouse, once it is issued.
(2) A warehouse receipt confers no rights in goods against a person who before
the issue of the receipt had a legal interest or perfected security interest in such
goods and who neither—
(a) delivered or entrusted those goods or any bill of lading, warehouse receipt,
delivery order or other document of title covering them to the bailor with
actual or apparent authority to ship, store, pack, process, transform or sell
the goods; nor
(b) acquiesced in the procurement by the bailor or his or her nominee of any
warehouse receipt or other document of title covering the goods.
(3) A buyer in the ordinary course of business of fungible goods sold and
delivered by a warehouse keeper who is also in the business of buying and selling
such goods, takes free of any claim under a warehouse receipt even though it has
been duly negotiated.
55. Rights acquired in the absence of due negotiation
(1) A transferee of a warehouse receipt, whether negotiable or non-negotiable,
who has taken the warehouse receipt by purchase, delivery and registration but
where the warehouse receipt is not duly negotiated, acquires the title and rights
which his or her transferor had or had actual authority to convey.
(2) In the case of a non-negotiable warehouse receipt, until but not after the
warehouse keeper receives notification of the registration by the Authority of the
transfer, the rights of the transferee may be defeated—
(a) by a buyer from the transferor in the ordinary course of business if the
warehouse keeper has delivered the goods to the buyer or has received
notification of his or her rights; or
(b) as against the warehouse keeper by dealings in good faith of the warehouse
keeper with the transferor.
56. Rights and obligations of transferors and transferees
(1) The endorsement of a warehouse receipt does not make the endorser liable
for any default by the warehouse keeper or by previous endorsers.
(2) The transferee of a negotiable warehouse receipt has a specifically
enforceable right to have his or her transferor supply any necessary endorsement but
the transfer becomes a negotiation only when the endorsement is supplied and the
negotiation registered by the Authority.
(3) Where a person negotiates or otherwise transfers a warehouse receipt for
value otherwise than as a mere intermediary under subsection (4), then unless
otherwise agreed, he or she warrants to his or her immediate purchaser—
(a) that the warehouse receipt is genuine; and
(b) that he or she has no knowledge of any fact which would impair the validity
or worth of the warehouse receipt; and
(c) that his or her negotiation or transfer is rightful and fully effective with
respect to the title of the warehouse receipt and the goods it represents.
(4) A collecting bank or other intermediary known to be entrusted with a
warehouse receipt on behalf of another or with collection of a draft or other claim
against delivery of a warehouse receipt warrants by the delivery of the warehouse
receipt, only its own good faith and authority.
(5) Subsection (4) shall apply even though the intermediary has purchased or
made advances against the claim or draft to be collected.
57. Conflicting claims and interpleader
If more than one person claims title to goods covered or purported to be covered by
a warehouse receipt, the warehouse keeper is excused from delivery until he or she
has had a reasonable time to ascertain the validity of the adverse claims or to bring
an action to compel all claimants to interplead and may compel the interpleader,
either in defending an action for non-delivery of the goods, or by original action,
whichever is appropriate.
PART X—OFFENCES
58. Issue of receipt for goods not received
A warehouse keeper, or any officer, agent, or servant of a warehouse keeper, who
issues or aids in issuing a warehouse receipt knowing that the goods for which the
receipt is issued have not been actually received by the warehouse keeper, or are not
under his or her actual control at the time of issuing the receipt, commits an offence
and is liable on conviction to fine not exceeding three times the value of the goods in
question or imprisonment not exceeding five years or both.
59. Issue of receipt containing false statement
A warehouse keeper, or any officer, agent or servant of a warehouse keeper, who
fraudulently issues or aids in fraudulently issuing a warehouse receipt for goods
knowing that it contains any false statement, commits an offence and is liable, on
conviction to a fine not exceeding one hundred and twenty currency points or to
imprisonment not exceeding five years or both.
60. Issue of duplicate receipt not duly marked
A warehouse keeper, or any officer, agent or servant of a warehouse keeper, who
fraudulently issues or aids in issuing a duplicate or additional negotiable receipt for
goods knowing that a former negotiable receipt for the same goods or any part of
them is outstanding and uncancelled, without plainly placing upon its face the word
“Duplicate” except in the case of a lost or destroyed receipt after proceedings under
section 33 of this Act, commits an offence, and is liable on conviction, to a fine not
exceeding one hundred and twenty currency points or to imprisonment not
exceeding five years or both.
61. Issue of receipts not stating fact of warehouse keeper’s ownership of goods
Where there are deposited with or held by a warehouse keeper goods of which the
warehouse keeper is owner, either solely or jointly or in common with others, the
warehouse keeper, or any of his or her officers, agents, or servants who, knowing the
ownership, issues or aids in issuing a negotiable receipt for those goods which does
not state that ownership, commits an offence and is liable on conviction, to a fine
not exceeding twenty four currency points or to imprisonment not exceeding one
year or both.
62. Delivery of goods without obtaining negotiable warehouse receipt
A warehouse keeper, or any officer, agent or servant of a warehouse keeper, who
delivers goods out of the possession of the warehouse keeper, knowing that a
negotiable receipt necessary to transfer the right of possession of those goods is
outstanding and uncancelled, without obtaining the possession of that receipt at or
before the time of the delivery, except in the cases referred to in sections 39 and 48
of this Act, commits an offence and is liable on conviction, to a fine not exceeding
twenty four currency points or to imprisonment not exceeding one year or both.
63. Negotiation of receipt for mortgaged goods
Any person who deposits goods to which he or she has no title, or upon which there
is a security interest, and who takes for those goods a negotiable receipt which he or
she afterwards negotiates for value with intent to deceive and without disclosing his
or her lack of title or the existence of the security interest, commits an offence and is
liable on conviction to a fine not exceeding one hundred and twenty fcurrency points
or to imprisonment not exceeding five years or both.
64. Issue of warehouse receipt without a valid licence
(1) Any person who purports to issue a warehouse receipt without a valid
licence commits an offence and is liable on conviction to a fine not exceeding one
hundred and twenty currency points or to imprisonment not exceeding five years or
both.
(2) Any person who contravenes the provisions of this Act and the Regulations
commits an offence and is liable on conviction to a fine not exceeding one hundred
twenty currency points or to imprisonment not exceeding five years or both.
PART XI—MISCELLANEOUS.
65. Revocation or termination of licence not to affect receipts
The revocation or termination of a licence under this Act shall not affect the validity
of receipts issued under the licence, and the warehouse keeper will continue to
comply with this Act with regard to valid receipts so far issued.
66. Insurance of goods
(1) A warehouse keeper shall ensure that goods stored in his or her custody are
at all times insured against all common perils such as loss by fraud, theft, fire,
employee infidelity, disasters such as drought, flooding, sabotage, internal
explosion, wind storm and any other disaster or perils and such other perils as the
Authority may determine by regulations made under this Act.
(2) A warehouse keeper shall keep exposed in a conspicuous place in the
warehouse, a notice in bold letters stating briefly the conditions under which goods
are insured under this Act.
(3) A warehouse keeper shall take prompt steps as may be necessary and proper
to collect any money which becomes due under a contract or insurance entered into
by him or her for the purposes of this Act and shall, as soon as the money is
collected, promptly pay any person entitled to receive the money.
(4) A warehouse keeper shall, in accordance with the terms of his or her
contract with insurance and bonding companies for the purpose of fulfilling the
insurance and bonding requirements under this Act, pay such premiums, permit
such reasonable inspections and make such reasonable reports as may be provided
for in those contracts.
67. Inspection of warehouses by Authority
The Authority or its appointed agent may inspect any licenced warehouse with
a view to investigating—
(a) storage facilities in the warehouse;
(b) how goods are classified;
(c) how goods are weighed;
(d) certification of goods; and
(e) whether the provisions of this Act are being complied with.
68. Classification of warehouses
(1) The Board may, by notice published in the Gazette classify a licenced
warehouse in accordance with its—
(a) ownership;
(b) location;
(c) surroundings;
(d) capacity;
(e) conditions or other qualities.
(2) The Board may prescribe different types of licences that may be issued in
respect to a classified warehouse.
69. Fees
The Board shall, in consultation with the Minister, by notice published in the
Gazette, prescribe the fees to be charged in respect of—
(a) examination and inspection of warehouses;
(b) licences issued under this Act;
(c) renewal of licences;
(d) issue of negotiable warehouse receipt books; and
(e) carrying out and performing such other functions conferred on it under this
Act by regulations made under this Act.
70. Seal of the Authority
(1) The common seal of the Authority shall be such device and in such form as
the Board may determine and shall be authenticated by the signatures of the
Chairperson and the Managing Director.
(2) In the absence of the Chairperson two other members of the Board shall
sign in place of the Chairperson; and in the absence of the Managing Director the
person performing the functions of the Managing Director shall sign.
(3) The signature of the Chairperson or of the Managing Director shall be
independent of the signing by any other person as witness.
(4) Every document purporting to be an instrument issued by the Authority and
to be sealed with the seal of the Authority authenticated in the manner prescribed in
subsections (2) and (3) shall be received in evidence and be deemed to be such an
instrument without further proof unless the contrary is shown.
(5) The Seal of the Authority shall be kept in the custody of the Secretary.
71. Protection of members of the Board and staff of the Authority
A member of the Board or any employee or other person performing any function of
the Authority under the direction of the Board shall not be personally liable for any
civil proceedings for any act or omission on his or her part in good faith in the
performance of those functions.
72. Annual report
The Board shall cause to be prepared and shall submit to the Minister within three
months after the end of each financial year, an annual report on the activities and
operations of the Authority for that financial year.
73. Minister to report to Parliament
The Minister shall, in each year, submit to Parliament the auditor’s report not later
than sixty days after receiving them from the Board under section 22 and the annual
report of the Authority submitted to the Minister under section 72 of this Act.
74. Regulations
(1) The Minister may, on the recommendation of the Board, by Statutory
Instrument make regulations, as may be necessary for the better carrying into effect
of this Act.
(2) Without prejudice to the general effect of subsection (1), regulations made
under that subsection may—
(a) prescribe forms to be used for any process under this Act and the forms of
licences and other documents under this Act;
(b) prescribe in connection with any contravention of the regulations—
(i) a penalty of a fine not exceeding one hundred currency points or to
imprisonment not exceeding two years or both; and
(ii) in the case of a continuing offence, an additional penalty not
exceeding one currency point for each day on which the offence
continues.
75. Minister’s power to amend Schedules
(1) The Minister may, with the approval of Cabinet, by statutory instrument
amend the First Schedule to this Act.
(2) The Minister may, on the recommendation of the Board, by statutory
instrument amend the Second and Third Schedule to this Act.
SCHEDULES.
FIRST SCHEDULE
SECTIONS 2 AND 74.
CURRENCY POINT
A currency point is equivalent to twenty thousand shillings.
SECOND SCHEDULE
SECTIONS 11 AND 75
MEETINGS OF THE BOARD
1. Convening meetings
(1) The Chairperson shall convene the first meeting of the Board as soon as is
practicable after the appointment of the Board and thereafter the Board shall meet for the
transaction of business at times and places that may be decided upon by the Board but the
Board shall meet at least once in every two months.
(2) The Chairperson or, in the absence of the Chairperson, a member appointed by the
Board to act as Chairperson may, at any time, call a special meeting of the Board, or shall
call a special meeting upon a written request by a majority of the members of the Board.
(3) The Chairperson shall preside at all meetings of the Board and in his or her
absence, the members present may appoint a member from among themselves to preside at
that meeting.
2. Quorum
The quorum at a meeting of the Board shall be four members.
3. Taking decisions
Questions proposed at a meeting of the Board shall be decided by a majority of the votes, of
the members present and if there is an equality of votes, the person presiding shall have a
casting vote in addition to his or her deliberative vote.
4. Disclosure of interest
(1) A member of the Board who has any pecuniary interest in a matter being
considered or about to be considered by the Board shall, as soon as possible after the
relevant facts have come to his or her knowledge, disclose the nature of his or her interest to
the Board.
(2) A disclosure of interest under subparagraph (1) shall be recorded in the minutes of
the meeting of the Board and the member making the disclosure shall not, unless the Board
otherwise determines in respect of that matter—
(a) be present during any deliberation on the matter by the Board;
(b) take part in the decision-making of the Board on the matter.
(3) For the purpose of the making of a decision by the Board under sub-paragraph (2)
the member who has made the disclosure shall not—
(a) be present during the deliberations of the Board for the making of that
determination;
(b) influence any other member or take part in the making of the determination by the
Board.
5. Co-option of persons to meetings of Board
(1) The Board may co-opt any person to any meeting of the Board to assist it on any
matter if the Board is satisfied that that person’s qualifications and experience are likely to
benefit the Board.
(2) A person co-opted to assist the Board under subparagraph (1) is entitled to take part
in the proceedings of the Board at the meeting concerning the matter in connection with
which he or she is co-opted, but is not entitled to vote or take part in any other proceedings
of the Board.
6. Minutes of meetings
(1) The Board shall cause the minutes of its meetings to be recorded and kept and the
minutes of each meeting shall be confirmed by the Board at the next meeting and signed by
the Chairperson of the meeting.
(2) The Chairperson of the Board shall submit to the Minister a copy of the minutes of
each meeting as soon as the minutes have been confirmed.
7. Board to regulate its own procedure
Subject to the provisions of this Schedule, the Board may regulate its own
proceedings.
THIRD SCHEDULE
SECTION 40(1)
FORM OF WAREHOUSE RECEIPT
WAREHOUSE RECEIPT SYSTEM ACT 2006
WAREHOUSE RECEIPTNo. _________ Serial No. ____________
ISSUED TO: (Depositor’s full name, address, and registration No. (VAT or equivalent)________________
(the "Depositor")
This is to certify that Warehouse keeper (Full name) has received the following goods (the "goods") for storage
in good order and condition (except as noted) subject to the provisions of the Warehouse Receipt Act 2006 (the
"Act") dated …………….., which the depositor listed above confirms having full knowledge of and accepts
irrevocably.
DESCRIPTION OF GOODS REMARKS/NOTES/QUALITY ANALYSIS/MARKINGS
GROSSWEIGHT NET WEIGHT
NO. OF PACKAGES: DECLARED ORIGIN (As per depositor’s declaration):
LOCATION OF STORAGE DATE RECEIVED
INSURANCE: Covered through:
For (risks):
As per the depositor’s declaration. Whilst Warehouse keeper will take all reasonable steps to verify the
insurance cover at the date mentioned above, Warehouse keeper., by signing this Warehouse Receipt, makes no
representation and extends no warranty whatsoever as to the existence, validity, or conformity to the above of
any insurance cover, or as to the payment of any premium, or as to compliance to any provision related thereto.
Delivery or partial delivery of the goods listed above will only be made upon surrender to Warehouse keeper of
this Warehouse receipt AND written instructions by the depositor or the last Transferee of this Warehouse
Receipt, as per the Act.
The goods are subject to the following charges, and will only be released upon full settlement thereof.
Collateral Management charges:
Warehousing charges_______________________________________________________
Other charges:__________________________________________________________
A priority lien on the goods exists with regards to any unpaid charges as per the Act
By appending his or her signature here below, the depositor represents and warrants that:
(1) He/She is the owner or the duly authorised agent of the owner of the goods or holds a valid pledge on the
goods;
(2) The goods are free of any pledge, claim or demand by third parties;
(3) He/She has full knowledge of and irrevocably accepts the provisions.
These representations and warranties shall be binding upon the depositor and any subsequent transferee of this
Warehouse Receipt as evidenced by such transferee appending his or her signature on each transfer overleaf.
WAREHOUSE RECEIPT NO. ___________ Serial No. __________ Dated ___________
Warehouse keeper is not the owner of the goods either solely, or jointly or in common with others.
Date: ........................ Warehouse keeper ………………….. The depositor ………………
FIRST TRANSFER
We______________ [depositor’s full name, address, and registration No. (VAT or equivalent)] (The
"Depositor"), to whom the Warehouse Receipt referred to above, the details of which are stated overleaf, (the
"Warehouse Receipt") has been issued, hereby transfer this Warehouse receipt, with all the rights and
obligations attached thereto, including the Provisions of the Warehouse Receipt System Act
to______________ [Transferee’s full name, address, and registration No. (VAT or equivalent)] (the
"Transferee").
We______________ [Transferee’s full name, address, and registration No. (VAT or equivalent)], hereby
accept the Transfer above.
By appending their signatures here below, both depositor and transferee hereby acknowledge and irrevocably
accept that:
- This warehouse receipt is subject to the details overleaf and to the Act, which are binding upon them.
- No transfer of this warehouse receipt shall be valid unless countersigned by warehouse keeper.
- Any obligation with regards to unpaid charges related to the goods covered under this warehouse receipt is
transferred with this warehouse receipt to the transferee.
The depositor The Transferee Warehouse keeper
Date
SECOND TRANSFER
We______________ [depositor’s full name, address, and registration No. (VAT or equivalent)] (The
"Depositor"), to whom the Warehouse Receipt referred to above, the details of which are stated overleaf, (the
"Warehouse Receipt") has been issued, hereby transfer this Warehouse receipt, with all the rights and
obligations attached thereto, including the Provisions of the Warehouse Receipt System Act
to______________ [Transferee’s full name, address, and registration No. (VAT or equivalent)] (the
"Transferee").
We______________ [Transferee’s full name, address, and registration No. (VAT or equivalent)], hereby
accept the Transfer above.
By appending their signatures here below, both depositor and transferee hereby acknowledge and irrevocably
accept that:
- This warehouse receipt is subject to the details overleaf and to the Act, which are binding upon them.
- No transfer of this warehouse receipt shall be valid unless countersigned by warehouse keeper.
- Any obligation with regards to unpaid charges related to the goods covered under this warehouse receipt is
transferred with this warehouse receipt to the transferee.
The depositor The Transferee Warehouse keeper
Date
THIRD TRANSFER
We______________ [depositor’s full name, address, and registration No. (VAT or equivalent)] (The
"Depositor"), to whom the Warehouse Receipt referred to above, the details of which are stated overleaf, (the
"Warehouse Receipt") has been issued, hereby transfer this Warehouse receipt, with all the rights and
obligations attached thereto, including the Provisions of the Warehouse Receipt System Act
to______________ [Transferee’s full name, address, and registration No. (VAT or equivalent)] (the
"Transferee").
We______________ [Transferee’s full name, address, and registration No. (VAT or equivalent)], hereby
accept the Transfer above.
By appending their signatures here below, both depositor and transferee hereby acknowledge and irrevocably
accept that:
- This warehouse receipt is subject to the details overleaf and to the Act, which are binding upon them.
- No transfer of this warehouse receipt shall be valid unless countersigned by warehouse keeper.
- Any obligation with regards to unpaid charges related to the goods covered under this warehouse receipt is
transferred with this warehouse receipt to the transferee.
The depositor The Transferee Warehouse keeper
Date
Cross References
Arbitration and Conciliation Act Cap 4.
Insurance Act Cap 213.